How to Prevent Child Identity Theft Part Two: What Business Can Do

Last week, I wrote about the recent increase in instances of child identity theft and the steps parents can take to help prevent and mitigate the impact of the theft. Child identity theft is a lucrative crime for thieves. Most children's Social Security Numbers and other credit information remain unused until they turn 18, leaving years for thieves to do serious damage like taking out mortgages, credit cards and car loans.

While parents ultimately hold the reigns when it comes to protecting their children from identity theft, there are also opportunities for businesses to get involved. The opportunities fall into two categories: things businesses can to do help mitigate the risk of child identity theft and services businesses can offer to help parents better monitor their child's identity.

What Can Businesses Do?

One of our favorite mottos here at CSID is "if you collect it, you've got to protect it." What this motto boils down to -- if you don't need to collect certain information for business purposes, than simply don't. If you don't need a child's social security number -- don't ask for it on a form. Same thing for date-of-birth. It is impossible to lose information that you don't have.

If you must collect information, make sure it is properly protected. On a basic level, protection includes encrypting the information and keeping it stored behind a firewall. Antivirus software should also be an essential component of any business' security plan. A recent Panda Security research report found that 31 percent of PCs have been infected with malware. Many of these malware strains are designed to give a thief access to sensitive information or the computer system itself.

Finally, one of the best things a business can do is teach their employees how to properly handle sensitive information, whether it is a child's social security number or a customer's email address. This includes basics like shredding forms with sensitive information before throwing them out, creating strong passwords for systems to protect customer information and properly securing company devices like phones and laptops. I've said it before and I'll say it again -- the human component is usually the weakest link in any security system. Make sure your employees are not the weakest link.

What Services Can Businesses Offer?

Child identity theft happens in a very similar way to adult identity theft. A thief steals personal information like a Social Security Number, birthdate and name and then uses that information to open fraudulent accounts, assume an identity and even apply for a job. There are a number of services a business can offer to help parents monitor for and protect against child identity theft:

• Credit Report Monitoring: It is hard to imagine a child having credit history, but credit history is one of the best ways to identify instances of child identity theft. Businesses can offer monitoring services that can help a parent keep tabs on their child's credit report and alert the parent when unusual activities like credit inquiries or new lines of credit are detected.

• Social Security Number Trace: Child identity theft can go beyond credit fraud. Sometimes a Social Security Number can be used to secure a job and file taxes. Social Security Number tracking monitors for and notifies when names, aliases and addresses become associated with a SSN. It can help parents detect identity theft sooner and can greatly reduce the time, money and emotional stress associated with a stolen SSN.

• Identity Restoration: Fixing identity theft can be a long and arduous process. Identity restoration services can take the burden off busy parents. There are multiple levels of identity restoration that businesses can offer. With full-service identity restoration parents give the business limited power of attorney and the business can then file all the forms and take all the necessary actions to correct a child's credit record. With self-service identity restoration, a business can provide a parent with step-by-step instructions about how to repair a child's identity on their own.
Bottom Line

Child identity theft is a growing problem. It is cruicial for businesses to make sure any personal information they collect for children is properly protected. It is also important that they provide the services parents need to better monitor and protect their children's identity. It's difficult to image an18-month-old with a mortgage, but it happens and as a business, we must do our part to prevent it.